62% Of Local Publishers Using Programmatic

Nearly two-thirds (62%) of local publishers
are selling inventory via programmatic, according to a recent Forrester Consulting study. The number one method for programmatic selling is via ad exchanges, which 58% of local publishers are
using. Over half (52%) use a supply-side platform (SSP) to sell and 47% have direct API integrations with buyers. There is some overlap between those three methods.

The Forrester study was
commissioned by Simpli.fi, a demand-side platform (DSP). Forrester did an online survey of 100 publishing and ad organizations in the U.S. regarding their use of programmatic ad tools at the local
market level. The study took place between February and April 2014.

Of the 62% of local publishers selling inventory via programmatic, 70% are selling display, 68% are selling video and 56%
are selling mobile.

The topic of local publishers using programmatic was at the forefront earlier this week when Centro, a programmatic ad platform, announced new and expanded partnerships
with local publishers, including Disney/ABC Televeision, Tribune Company, Metro and others.

When announcing the partnerships, Katie Risch, Centro’s SVP of publisher development, told Real-Time Daily that she believes a local publisher’s
“greatest asset” is a sales team that has in-market relationships, but she believes those sales teams are under-leveraged.

At least according to the Forrester report, however,
local publishers are putting their sales teams to use. The vast majority (84%) of respondents are leaning on their direct sales teams to manage programmatic sales.

Frost Prioleau, CEO of
Simpli.fi, also believes local publishers’ sales teams are valuable. “These publishers have had long relationships with their communities,” he said. “They know the local
economy and market well. They also have very valuable local audiences, data, knowledge and expertise, and are really leveraging that to sell digital campaigns, not only on their own property, but on
the other properties that their local advertisers want to advertise."

Local publishers said that advertisers looking to use programmatic most commonly request behavioral targeting support.
Search and site retargeting are the second and third most common requests, per the report, followed by device targeting, contextual targeting, CRM data and geofencing.

“There’s
definitely been a shift in the last two to three years,” the report quotes a director of digital revenue and sales at a local newspaper as saying. “Advertisers are demanding higher quality
targeting.”

The local publishers surveyed said that 78% of their advertisers buy at least 20% to 29% of their digital media via programmatic. Additionally, 67% of the publishers believe
the use of programmatic will increase over the next 18 months, with display, mobile and video leading the way.

The last paragraph is interesting as it offers a clue about the approximate volume of programmatic transactions, not merely how many publishers use this method of selling "inventory". According to the survey, 78% of the local publishers said that their advertisers buy " at least 20-29% of their digital media via programmatic". If this represents the high end of the response scale and that all buys involve about the same dollar volume, this probably means that roughly 20% of the buys are programmatic in terms of money spent------assuming that the respondents' estimates are on target. While it is obvious that the percentage of local digital buys that are made programmatically ----whatever the real figure is-----will increase in the future, it's important to distinguish between "reach" ---the percentage that use programmatic to some extent and how "frequently" they do so-------in other words, how much money is spent in this manner.